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| California Housing Market Outlook for 2004: Continued Price Appreciation, Slight Decline in Sales From 2003's Record Setting Pace |
LOS ANGELES, Dec. 30 /PRNewswire/ -- Sales of detached existing single-
family homes are expected to decline in 2004 from 2003's record-setting pace,
while price appreciation will continue to be driven by strong demographics and
higher, though historically low, interest rates in 2004, according to the
California Association of REALTORS(R) (C.A.R.) "State of the Housing Market
2003" report.
The median price of a single-family home is forecast to increase
13 percent from $369,5000 in 2003 to $417,500 in 2004, while sales are
projected to decline 2 percent to 584,600 in 2004 from a record 596,500
in 2003.
As long as mortgage rates remain in the 6 to 7 percent range, most
households will favor fixed rate mortgage instruments over adjustable
mortgages, according to the report. However, the share of adjustable rate
mortgages will climb in the year to come. Supply conditions in the market
will remain very tight, and have the potential to set new record lows in the
coming year.
"Strengthening economic conditions should drive job growth and household
incomes should head upwards, adding fuel to the housing market," said C.A.R.
Vice President and Chief Economist Leslie Appleton Young. "Repeat homebuyers
will continue to dominate the market in 2004, rolling their equity gains on
prior home sales into subsequent home purchases.
"Job growth was nil over the past two to three years, but households with
jobs saw their incomes increase," she said. "With job numbers on the rise,
there will be a spurt in household income growth. The cooling effects on the
housing market of rising mortgage rates will be partially offset by gains in
household incomes, resulting in continued strength in the housing market."
The California Association of REALTORS(R) ( http://www.car.org ) is one of
the largest state trade organizations in the United States, with more than
130,000 members dedicated to the advancement of professionalism in real
estate. C.A.R. is headquartered in Los Angeles.
SOURCE California Association of REALTORS (C.A.R.)
back to topRelated links:
CONTACT:
Mark Giberson of California Association of
REALTORS (C.A.R.), +1-213-739-8304, markg@car.org
